R 251604Z FEB 87
FM AMCONSUL ALEXANDRIA
TO SECSTATE WASHDC 6526
INFO AMEMBASSY CAIRO
AMEMBASSY AMMAN
AMEMBASSY TEL AVIV
AMCONSUL JERUSALEM
AMEMBASSY RIYADH
USCINCCENT MACDILL AFB FL

C O N F I D E N T I A L SECTION 01 OF 04 ALEXANDRIA 00292 
 
USCINCCENT FOR POLAD HOWELL 
 
E.O. 12356: DECL: OADR 
TAGS: KPRP PINS PGOV PHUM ECON PINR SOCI EG
SUBJECT:  ISLAMIC TRILOGY, PART III:  COMMERCIAL AND 
          PHILANTHROPIC ACTIVITIES OF THE ISLAMIC 
          RIGHT IN ALEXANDRIA 
 
REF:  (A)  ALEXANDRIA 00289 
      (B)  ALEXANDRIA 00290 
      (C)  ALEXANDRIA 00291 
- 
¶1.  (CONFIDENTIAL - ENTIRE TEXT.) 
- 
- 
¶2.  SUMMARY AND COMMENT:  THIS TELEGRAM TRANSMITS 
THE THIRD AND FINAL INSTALLMENT IN OUR SERIES 
ON THE ISLAMIC RIGHT IN ALEXANDRIA.  WHILE THE 
SPIRITUAL FORCE OF RIGHTIST ISLAM IS GROWING, 
ITS POLITICAL POTENTIAL IS STILL RELATIVELY 
UNFORMED AND DIFFICULT TO GAUGE IN ALEXANDRIA, 
EVEN IF IT EXISTS BEHIND THE SCENES.  WHERE THE 
ISLAMIC RIGHT IS HAVING ITS INFLUENCE MORE 
PALPABLY FELT IS IN COMMERCE, SOCIAL AND WELFARE 
ACTIVITIES, AND PHILANTHROPY.  FOR THE TIME 
BEING, THIS HAS NOT TRANSLATED INTO ANY DIRECT 
POLITICAL SPOILS.  HOWEVER, BUSINESSMEN WITH 
ISLAMIC CREDENTIALS (OR IN ORDER TO OBTAIN 
ISLAMIC CREDENTIALS) DONATE MONEY TO THE "ISLAMIC 
GAMAAT," SOME OF THE PROMINENT RELIGIOUS LEADERS 
MENTIONED IN PART II, AND MANY OF THE WELFARE 
AND CHARITABLE ACTIVITIES THEY SPONSOR.  IN 
THIS WAY, THE ACTIVITIES OF THE ISLAMIC ECNOMIC 
SECTOR ARE SOMEWHAT DISTURBING, TENDING TO PROVIDE 
THE FINANCIAL WHEREWITHAL TO POTENTIALLY DESTABILIZING 
SOCIO-POLITICAL GROUPS WHO SOMETIMES HAVE A VERY 
DIFFERENT POLITICAL AGENDA THAN THE GOE.  IN 
OTHER WAYS, HOWEVER, THESE BUSINESSMEN ACTUALLY 
CONTRIBUTE TO THE STABILITY OF THE CURRENT 
REGIME BY PROVIDING A PORTION OF THE SAFETY NET 
AND SERVICES WHICH AN OVERSTRETCHED GOVERNMENT 
CANNOT PROVIDE.  END SUMMARY AND COMMENT. 
- 
- 
WHO'S WHO IN ALEXANDRIA'S ISLAMIC BUSINESS WORLD? 
--------------------------------------------- ---- 
¶3.  AN INCREASING NUMBER OF COMPANIES IN ALEXANDRIA, 
AS ELSEWHERE IN EGYPT, ARE ADDING "ISLAMIC" TO 
THEIR TITLES OR--MORE COMMONLY--LETTING WORD 
SPREAD THAT THEY ARE ISLAMIC COMPANIES.  IN 
PRACTICE, THIS SOMETIMES MEANS USING ISLAMIC 
BANKING INSTITUTIONS AS MUCH AS POSSIBLE AND 
GIVING PREFERENCE TO MUSLIMS AS EMPLOYEES.  IN 
SOME INSTANCES, BUSINESSMEN ARE AFFILIATING 
THEMSELVES WITH SUCH ACTIVITIES OR COMPANIES 
BECAUSE IT IS CHIC TO DO SO.  OTHERS INVOLVE 
THEMSELVES FROM SINCERE CONVICTION, BECAUSE THEY 
HOPE TO PROFIT FROM SUCH ALLIANCES, OR THE 
MOTIVATION MAY BE A COMBINATION OF THE ABOVE. 
- 
- 
¶4.  TWO PILLARS OF THE LOCAL BUSINESS ESTABLISHMENT, 
MUSTAFA AL-NAGGAR, AND MOHAMMED RAGAB HAVE LONG 
BEEN IDENTIFIED WITH THIS CURRENT, ALTHOUGH THEY 
ARE NOT AFFILIATED DIRECTLY WITH ANY ISLAMIC 
COMPANIES PER SE.  TOGETHER, THEY ARE AMONG THE 
LEADING BENEFACTORS IN ALEXANDRIA TO ISLAMIC 
INDIVIDUALS, ORGANIZATIONS AND SOCIETIES--SOME RADICAL, 
SOME NOT.  FOR EXAMPLE, AL-NAGGAR IS PERSONALLY 
CLOSE TO SHAYKH AHMAD AL-MAHALLAWI, ALTHOUGH HE 
(NAGGAR) NEVER ARTICULATES SIMILARLY INTOLERANT 
POLITICAL OR RELIGIOUS VIEWS AND, INDEED, INSISTS 
THAT AL-MAHALLAWI HAS MELLOWED.  NEVERTHELESS, 
NAGGAR IS CONSIDERED ONE OF THE TWO WEALTHIEST 
MEN IN ALEXANDRIA, AND HIS SUPPORT FOR THE 
ISLAMIC RIGHT HERE, REGARDLESS OF MOTIVATION, 
IS SIGNIFICANT. 
- 
- 
¶5.  MOHAMMAD RAGAB IS YOUNGER, MORE DYNAMIC, AND--IN 
THE VIEW OF OUR MUCH PRAISED COMMERCIAL SPECIALISTS--A 
BETTER BUSINESSMAN THAN NAGGAR.  HE IS NOT AS 
WEALTHY, BUT HE IS MORE AMBITIOUS AND OUTSPOKEN. 
A SIGN OVER THE BAR NEXT TO THE OLYMPIC-SIZED 
INDOOR POOL AT HIS SUMPTUOUS HOME ADVERTISES 
THAT "FOR THE SAKE OF YOUR HEALTH, THE RAGABS 
SERVE ONLY FRUIT JUICES AND SOFT DRINKS." 
- 
- 
¶6.  THERE IS BAD BLOOD BETWEEN RAGAB AND NAGGAR, 
LARGELY BECAUSE THE FORMER MOVED INTO THE IMPORTED 
FOOD AREA WHICH HAD BEEN NAGGAR'S MAINSTAY WHEN 
THE CAR IMPORT AND HEAVY MACHINERY BUSINESS, 
WHICH WAS RAGAB'S PRINCIPAL ACTIVITY, LOST 
VIABILITY WITH THE NEW IMPORT RESTRICTIONS. 
RAGAB CURRENTLY HEADS THE ALEXANDRIA BUSINESSMEN'S 
GROUP BUT HAS AMBITIONS TO CUT A WIDER SWATH. 
AS EFFECTIVE AS HE IS, HE IS DISLIKED IN SOME 
CIRCLES BECAUSE HE IS VIEWED AS TOO MUCH OF A 
SELF-PROMOTER.  NOT IDENTIFIED WITH ANY ONE 
ISLAMIC SPIRITUAL PERSONALITY IN ALEXANDRIA, RAGAB 
IS ALLEGED TO DONATE CONSIDERABLE SUMS OF MONEY 
TO A VARIETY OF ISLAMIC CHARITIES AND "ISLAMIC 
GAMAAT."  IN ADDITION, HE HAS HELPED PROMOTED 
BUSINESSMEN WHO ARTICULATE A SIMILAR, "ISLAMIC," 
POINT OF VIEW. 
- 
- 
¶7.  ANOTHER FIGURE WHO IS OF INTEREST LOCALLY IS 
DR. ALI AL-MEHELBA WHO HEADS THE AL-ANDALUS ACID 
COMPANY (DISCUSSED IN DETAIL IN 86 ALEXANDRIA 1406). 
TRAINED AS A MEDICAL DOCTOR, AL-MEHELBA MORE OR 
LESS CAME FROM NOWHERE.  HIS CONSTRUCTION 
ACTIVITIES (UPSCALE HOUSING, HOSPITALS, AND 
TOURIST VILLAGE SCHEMES) ARE WIDE SCALE AND ARE 
ALLEGEDLY FINANCED THROUGH SHAREHOLDING AND 
PYRAMID FINANCING IN A WAY TO AVOID THE APPEARANCE 
OF PAYING "INTEREST."  HOWEVER, HE APPEARS TO 
HAVE OVER EXTENDED HIMSELF, AND LOCAL SOURCES 
TELL US HE MAY BE IN TROUBLE.  THIS HAS NOT 
STOPPED HIM, HOWEVER, FROM PLANNING ADDITIONAL 
PROJECTS. 
- 
- 
¶8.  MEHELBA IS BELIEVED TO HAVE CLOSE TIES AND 
"FRIENDS" IN SAUDI ARABIA.  HE MAINTAINS BRANCHES 
OF HIS FIRM THERE, IN PART TO ELICIT FINANCIAL 
SUPPORT FROM THE LARGE EXPATRIATE EGYPTIAN 
COMMUNITY WHO OFTEN INVEST IN HIS CONSTRUCTION 
PROJECTS.  IT IS ALSO RUMORED THAT UNIDENTIFIED 
SAUDI SOURCES GAVE MEHELBA HIS INITIAL BOOST 
AND MAY ALSO BE CALLED UPON TO RESCUE HIM IF HIS 
CURRENT LIQUIDITY PROBLEMS ARE NOT RESOLVED. 
- 
- 
¶9.  TWO OTHER INTERESTING BUSINESS FIGURES HAVE 
ALLEGED TIES TO SAUDI ARABIA.  ONE, TALAAT 
MUSTAFA IBRAHIM (USUALLY KNOWN AS TALAAT MUSTAFA) 
RUNS THE HUGE ALEXANDRIA CONSTRUCTION COMPANY. 
NO ONE REALLY KNOWS WHERE MUSTAFA GOT HIS ORIGINAL 
SEED MONEY:  ALEXANDRIANS ARE SUSPICIOUS THAT 
MUSLIM BROTHERS (MANY OF WHOM WERE EXILED IN 
SAUDI ARABIA) HELPED HIM OBTAIN SAUDI BACKING 
IN THE MID-1970'S. 
- 
- 
¶10.  IN ANY EVENT, MUSTAFA TENDS TO WEAR HIS 
ISLAM ON HIS SLEEVE, WHILE HIS WIFE, WHO WEARS 
THE "HEGAB" OR HEAD COVERING, HAS MADE HERSELF 
UNWELCOME IN SOME QUARTERS BECAUSE OF HER INCESSANT 
EXHORTATIONS TO OTHER UPPER CLASS WOMEN TO DO 
LIKEWISE.  MUSTAFA'S MOST CONTROVERSIAL MOVE TO 
DATE HAS BEEN THE PLACEMENT OF A LARGE, AND 
HIGHLY VISIBLE BILLBOARD, WITH THE ISLAMIC CREED 
EMBLAZONED ON IT, ON TOP OF ONE OF HIS BUILDINGS 
(86 ALEXANDRIA 1425).  HE HAS VERY CLOSE RELATIONS 
WITH MUHAMMED RAGAB, AND THE LATTER HAS BEEN 
ACCUSED BY DETRACTORS OF TRYING TO PROMOTE HIM 
INTO A KEY POSITION WITHIN THE ALEXANDRIA 
BUSINESSMEN'S GROUP.  TOGETHER, THE TWO WERE 
RECENTLY INVOLVED IN A CONTROVERSIAL (BUT NOT 
UNPOPULAR) PROPOSAL TO BUILD AN ISLAMIC-ORIENTED 
PRIVATE COLLEGE IN ALEXANDRIA.  THE MINISTER OF 
EDUCATION RECENTLY QUASHED THE IDEA ON CURRICULUM 
GROUNDS, BUT MOVES ARE UNDERWAY TO TRY TO RESUSCITATE IT. 
- 
- 
¶11.  ANOTHER "MYSTERIOUS" BUSINESSMAN WHO IS 
BECOMING PROMINENT IS HAJJ AHMED EBEID (AKA 
AHMAD UBAYD).  HE IS AFFILIATED WITH TWO ISLAMIC 
INVESTMENT COMPANIES.  THERE HAVE BEEN SOME 
SUGGESTIONS THAT EBEID IS AFFILIATED WITH ALI 
AL-MEHELBA, BUT THIS HAS NOT YET BEEN CONFIRMED. 
- 
- 
ALEXANDRIA ACTIVITIES OF ISLAMIC COMPANIES AND BANKS 
--------------------------------------------- ------- 
¶12.  THERE ARE SEVERAL "ISLAMIC COMPANIES" BASED 
IN ALEXANDRIA, INCLUDING AL-ANDALUS ACID 
(MENTIONED ABOVE), AL-MADINA AL-MINAWARA (REAL 
ESTATE DEVELOPMENT), AL-MARWA, AL-SAFAA, AND THE 
ALEXANDRIA CONSTRUCTION COMPANY, AN OLDER 
COMPANY FOUNDED IN 1974.  A FORMER GOVERNOR OF 
ALEXANDRIA TOLD US ON JANUARY 29 THAT THE 
ISLAMIC COMPANIES ARE HEALTHY, GROWING RAPIDLY, 
AND THAT THIS TREND WILL CONTINUE. 
- 
- 
¶13.  THE LARGEST SUCH FIRM (AND ONE OF THE OLDEST) 
IS PROBABLY TALAAT MUSTAFA'S ALEXANDRIA 
CONSTRUCTION COMPANY.  THIS COMPANY HAS BUILT 
600 FLATS IN MONTAZA AND IS CONSTRUCTING SUMMER 
FLATS IN MAMOURA.  TO THE WEST OF THE CITY, IT 
CONSTRUCTED ITS FIRST PROJECT AND A PLANT TO 
EXTRACT SALTS IN 1974 AND BUILT 1,500 FLATS TO 
ACCOMMODATE THE WORKERS. 
- 
- 
¶14.  IN AN OCTOBER 1986 DISCUSSION, MUSTAFA 
STATED THAT HIS COMPANY, LIKE MANY OTHERS, PUTS 
ITS MONEY IN THE FAYSAL BANK AND OTHER ISLAMIC 
BANKS BECAUSE THEY "TRUST" THEM AND ALSO, BECAUSE 
THEY CAN TAKE DOLLARS OUT OF EGYPT "IF OR WHEN 
NECESSARY."  HE FLATLY DENIED THAT FUNDS FOR 
ISLAMIC COMPANIES COME FROM SAUDIS OR THE SAG, 
ALLEGING THAT THE MONEY COMES SOLELY FROM EGYPTIAN 
EXPATS IN SAUDI ARABIA AND THE GULF WHO WANT TO 
INVEST IN EGYPT, BUY FLATS, AND WHO HAVE "MORE 
TRUST" IN ISLAMIC INSTITUTIONS THAN IN SECULAR 
ONES. 
- 
- 
¶15.  WHILE THE FAYSAL BANK HIRES ONLY MUSLIMS, 
(86 ALEXANDRIA 1215), THIS IS NOT TRUE OF SOME 
OF THE COMPANIES.  A GOOD CHRISTIAN SOURCE TOLD 
US RECENTLY THAT HE HAS FRIENDS WHO WORK IN ONE 
OF THE AL-ANDALUS COMPANIES.  MANY ARE DESIRABLE, 
HE SAID, BECAUSE OF THEIR KNOWLEDGE OF FOREIGN 
LANGUAGES. 
- 
- 
ISLAMIC WELFARE ASSOCIATIONS IN ALEXANDRIA 
------------------------------------------ 
¶16.  EMBASSY REPORTING 986 CAIRO 28338) HAS 
DETAILED THE IMPORTANT ROLE PRIVATE WELFARE 
ASSOCIATIONS ROLE PLAY AS A SAFETY NET AND AS A 
STABILIZING FORCE IN A CHANGING SOCIETY.  SIMILAR 
ORGANIZATIONS PROSPER IN ALEXANDRIA, AND MANY OF 
THEM ARE SPONSORED BY THE ISLAMIC RIGHT.  SOME 
OF THESE, LIKE THE "FAJR AL-ISLAM" AND "ASR-AL-ISLAM" 
CLINICS MENTIONED IN REF B ARE AFFILIATED TO 
RADICAL MOSQUES (COMMENT: THE "FAJR AL-ISLAM" 
CHARITABLE SOCIETY WAS THE ONLY ISLAMIC CHARITABLE 
SOCIETY IN ALEXANDRIA BANNED BY THE GOE IN THE 
1981 CRACKDOWN.  THE BAN WAS SUBSEQUENTLY LIFTED. 
END COMMENT.) 
- 
- 
¶17.  MORE COMMONLY, HOWEVER, THE ISLAMIC RIGHT 
SPONSORS MODERATE CHARITY AND WELFARE ACTIVITIES 
WITH FEW OR NO POLITICO-RELIGIOUS TRAPPINGS. 
ALEXANDRIA PHYSICIANS ARE PARTICULARLY ACTIVE 
IN ESTABLISHING POLYCLINCS.  THEY SOLICIT 
PRIVATE DONATIONS FROM MOSQUES, BUY THEIR 
EQUIPMENT, AND STAFF THEIR CLINICS WITHOUT 
ASSISTANCE FROM THE MINISTRIES OF SOCIAL AFFAIRS 
OR HEALTH.  OFTEN, PHYSICIANS FROM THE UNIVERSITY 
DONATE THEIR TIME IN THE AFTERNOONS.  HOSTELS FOR 
NEEDY FEMALE STUDENTS FROM OUTSIDE ALEXANDRIA, 
AS WELL AS DAY CARE AND OLD-AGE CENTERS, ARE OTHER 
TYPES OF ACTIVITIES SUPPORTED BY WELL-TO-DO 
DEVOUT MUSLIMS.  BECAUSE THE GOE IS UNABLE TO 
PROVIDE ADEQUATE FACILITIES FOR THESE VERY 
NECESSARY ACTIVITIES, ISLAMIC SOCIAL WELFARE 
ASSOCIATIONS OF THIS NATURE FULFILL A STABILIZING 
SOCIAL FUNCTION. 
- 
- 
PHILANTHROPY FROM THE ISLAMIC RIGHT 
----------------------------------- 
¶18.  MANY OF THE PROMINENT OWNERS OF ISLAMIC 
COMPANIES, SUCH AS MOHAMMED RAGAB, MUSTAFA AL-NAGGAR, 
AND DR. ALI MAHELBA, ARE ALSO WELL KNOWN 
PHILANTHROPISTS.  FOR EXAMPLE, RAGAB AND AL-NAGGAR 
HAVE CONTRIBUTED LARGE AMOUNTS OF MONEY TO A NEW 
DRUG REHABILITATION HOSPITAL IN MONTAZA; 
AL-NAGGAR HAS DONATED VERY EXPENSIVE EQUIPMENT 
TO THE UNIVERSITY OF ALEXANDRIA HOSPITAL; AND 
DR. MAHELBA TOLD US VERY RECENTLY THAT HE IS SETTING 
UP A PROJECT TO SUPPLY FOOD TO THE POOR BY GETTING 
WEALTHY PEOPLE TO DONATE PROVISIONS. THE PROJECT HAS 
BEEN WORKED OUT ON PAPER; HE NOW SEEKING SOMEONE 
TO ADMINISTER IT.  THIS LIST OF PHILANTHROPIC 
ACTIVITIES IS A LONG ONE AND AN IMPORTANT 
(AND IN SOME CASES, VITAL) SOURCE OF SUPPORT TO 
BOTH PUBLIC AND PRIVATE HOSPITALS, CLINICS, 
ORPHANAGES, AND SPECIALIZED WELFARE INSTITUTIONS. 
WITH THE POSSIBLE EXCEPTION OF USAID, "ISLAMIC" 
BUSINESSMEN ARE PROBABLY THE MOST IMPORTANT BENEFACTORS 
OF PRIVATE VOLUNTARY ORGANIZATIONS (ISLAMIC OR 
OTHERWISE) IN ALEXANDRIA AT THE PRESENT TIME. 
- 
- 
¶19.  CONCLUDING COMMENT:  ALTHOUGH THE ECONOMIC 
SQUEEZE DEPICTED IN 86 ALEXANDRIA 1301 HAS EASED 
SOMEWHAT, INCREASED NUMBERS OF UNEMPLOYED AND RISING 
PRICES CONTINUE TO BE A SERIOUS POTENTIAL PROBLEM 
IN ALEXANDRIA, AS ELSEWHERE.  THE LOCAL GOVERNMNET 
IS TRYING TO GET A HANDLE ON THE MANY INFRASTRUCTURAL 
INADEQUACIES AND GENERAL UNCLEANLINESS WHICH 
PLAGUE ALEXANDRIA, BUT THE PROBLEMS THE GOVERNORATE 
FACES CLEARLY OUTNUMBER THE AMOUNT OF RESOURCES 
IT HAS AVAILABLE TO CORRECT THEM OR AT LEAST 
BRING THEM UNDER CONTROL. 
- 
- 
¶20.  IN THIS SENSE, THE EXPANDING ISLAMIC 
PRIVATE SECTOR COMPANIES ARE A CONSTRUCTIVE 
FORCE, PROVIDING JOBS AND CONTRIBUTING GENEROUSLY 
TO VITALLY NEEDED SOCIAL SERVICES THROUGH A WIDE 
RANGING COMMITMENT TO WELFARE AND PHILANTHROPIC 
ACTIVITIES.  THUS, WHILE IT HAS BECOME FASHIONABLE 
IN SOME QUARTERS TO VIEW THE ISLAMIC RIGHT 
SOLELY IN TERMS OF A THREAT TO EGYPTIAN STABILITY, 
IN SOME RESPECTS, MODERATE ISLAMIC PROPONENTS 
MIGHT ACTUALLY CONTRIBUTE TO EGYPT'S STABILITY, 
PROVIDED THE ECONOMY DOES NOT FURTHER DETERIORATE 
AND RADICALIZE KEY SEGMENTS OF THE POPULATION. 
IF THIS WERE TO HAPPEN, EXTREMIST LEADERS FROM 
THE ISLAMIC RIGHT, WHO IN ALEXANDRIA HAVE ADOPTED 
A LOW PROFILE, COULD VERY WELL TRY TO EXPLOIT 
A TROUBLED SITUATION AND SEIZE THE INITIATIVE 
FROM THE NAGGARS, THE RAGABS, AND THEIR ILK 
WHO, DESPITE THEIR FINANCIAL SUPPORT FOR SOME 
NON-VIOLENT RADICAL ELEMENTS, SEEM DEDICATED ONLY 
TO SLOW, EVOLUTIONARY CHANGE IN EGYPT.  END 
CONCLUDING COMMENT. 
 
 
HAMBLEY